https://www.maslon.com/rss/feed/620
Creditors' rights representation in loan workouts and in bankruptcy is a core function of Maslon's Financial Services Group. We leverage our extensive work in this area to offer clients knowledgeable and careful guidance, helping them make practical assessments of relevant economic and legal risks.

Loan Workouts
Banks, asset-based lenders, equipment financiers, and other financial service providers regularly seek our representation regarding their rights in connection with defaults by commercial borrowers and guarantors. We view workouts as the process of maximizing lender recovery while directing a borrower to refinance or repay the loan as soon as practicable. In each case, the best approach will depend on a host of factors, including the integrity and competency of management, refinancing alternatives, the determination of the value of collateral, the dependence upon insiders to obtain recoveries, and other loan structure or documentation problems.

Our lawyers work closely with our clients to review loan documentation, establish strategic objectives, and implement a workout plan. We also advise lenders about appropriate responses to borrower fraud, accusations of lender liability, environmental risks, regulatory restrictions in the borrower’s industry, competing creditor claims, and other pitfalls they may face during the workout process.

We are skilled at drafting collateral turnover agreements, forbearance agreements, deeds in lieu of foreclosure, and other documents that facilitate repayment of a loan through the liquidation of collateral or the transition of a loan to another lender. Our litigation support in this area is also extensive. We have or establish teams with significant experience in prosecuting the full range of credit collection matters, including real and personal property foreclosures, receiverships, and the defense of third-party and lender liability claims.

Bankruptcy
Maslon's experience representing banks, indenture trustees, asset-based lenders, equipment financiers, and other non-debtor constituencies in bankruptcy is significant. We work to protect the rights of creditors and other parties affected by insolvency in virtually all bankruptcy procedural settings. In large bankruptcy cases, we focus their efforts on efficient and cost-effective client recovery. In smaller cases, we often seek deadlines in favor of senior secured creditors that the debtor must meet to continue to receive bankruptcy protection.

Our capabilities cross a broad array of substantive issues, including the permissible scope of first day orders, DIP lending, use of cash collateral, automatic stay, sales of assets, assumption or rejection of executory contracts, contested plan confirmations, preferences, fraudulent conveyances, and claims objections. We also regularly participate on unsecured creditor committees in large, complex Chapter 11 bankruptcy reorganizations on behalf of indenture trustees throughout the United States.

In cases where valuations and business solutions are complex, we work closely with financial advisors. In all regards, we help clients formulate an effective bankruptcy strategy, with attention to practical assessment of relevant economic and legal risks.

]]>en-usSun, 15 Sep 2019 10:12:07 Zhttps://www.maslon.com/amy-swedberg-to-present-on-bankruptcy-at-minnesota-cles-2019-midwest-ip-institute
Amy Swedberg, partner in Maslon's Financial Services and Litigation Groups, will serve on a panel for Minnesota CLE's 2019 Midwest IP Institute on September 26th, 2019. During the presentation, titled "For In-House Attorneys Advising on IP Matters – 20 'Crossover' Practice Tips on Antitrust, Privacy, Bankruptcy, and Advertising Law," a panel of four legal experts—one each in antitrust, privacy, bankruptcy, and advertising law—will answer common, critical questions about how their respective area of the law intersects with IP matters. Swedberg will present, "5 Bankruptcy Tips for In-House Counsel Advising on IP Matters."

Amy focuses her legal practice primarily on assisting lenders and other commercial creditors, asset purchasers, and adversary proceeding defendants with creditor rights and bankruptcy issues. She is an experienced litigator in the bankruptcy courts in Minnesota and other jurisdictions. Amy also assists lenders in real estate foreclosures, receiverships, pursuing loan collateral, negotiating workouts, and drafting commercial loan documentation.

]]>Thu, 26 Sep 2019 00:00:00 Zhttps://www.maslon.com/amy-swedberg-to-serve-on-a-panel-at-tma-minnesotas-educational-luncheon
Amy Swedberg, partner in Maslon's Financial Services Group, will serve on a panel at Turnaround Management Association (TMA) Minnesota's educational luncheon on June 20, 2019. During the presentation—titled "ABC's: Are They as Easy as 1, 2, 3?"—panel members will explore how Assignment for the Benefit of Creditors (ABCs) work and how they compare to other procedures for dealing with a financially distressed company.

Amy focuses her legal practice primarily on assisting lenders and other commercial creditors, asset purchasers, and adversary proceeding defendants with creditor rights and bankruptcy issues. She is an experienced litigator in the bankruptcy courts in Minnesota and other jurisdictions. Amy also assists lenders in real estate foreclosures, receiverships, pursuing loan collateral, negotiating workouts, and drafting commercial loan documentation. She has served on the Board of Directors of TMA Minnesota since 2012.

]]>Thu, 20 Jun 2019 00:00:00 Zhttps://www.maslon.com/maslon-attorney-cyri-van-hecke-elected-to-board-of-directors-of-the-parks-trails-council-of-minnesota
Maslon is pleased to announce that Cyri Van Hecke, attorney in Maslon's Litigation Group, has been elected to the Board of Directors of the Parks & Trails Council of Minnesota. Parks & Trails Council of Minnesota was established in 1954 as one of the first of its kind in the nation—a statewide citizen advisory board for state parks. The organization aims to acquire, protect, and enhance critical land for the public's use and benefit.

Cyri focuses her legal practice in the areas of real estate and construction litigation. She has represented financial institutions, contractors, suppliers, owners, commercial carriers, railroads, and other public and private entities in a variety of real estate and construction litigation matters. Cyri also has extensive experience with commercial real estate and lending transactions, including real estate acquisition, leasing, construction, development, and financing matters.

]]>Wed, 01 May 2019 00:00:00 Zhttps://www.maslon.com/maslon-welsomes-attorney-erin-snyder-to-the-firm
Maslon is pleased to announce the addition of attorney Erin Snyder to the firm's Financial Services Practice Group. Erin's experience will further strengthen Maslon's capabilities in key areas of practice for our clients.

Erin represents creditors and financial institutions in both in-court and out-of-court restructurings. Her practice also includes representing borrowers and lenders in commercial financing transactions. Erin graduated, cum laude, from Northwestern University Pritzker School of Law, where for two years she mentored first-year law students as an advisor for the school's Academic and Professional Excellence program. Erin earned her bachelor's degree in Philosophy and Catholic Studies, summa cum laude, from the University of St. Thomas.

Amy Swedberg, partner in Maslon's Financial Services Group, will co-chair the Turnaround Management Association's Mid-America Regional Conference (MARC) in Chicago on April 16-17, 2018. She will also participate in a panel discussion on "Alternatives to Bankruptcy" at the conference on Tuesday, April 17th, 2018. The panel will explore the advantages and disadvantages of the various alternatives to a chapter 11 bankruptcy filing, including state court receiverships, assignments for the benefit of creditors, UCC Article 9 foreclosures, and voluntary restructurings.

Amy focuses her practice primarily on assisting lenders and other commercial creditors, asset purchasers, and adversary proceeding defendants with creditor rights and bankruptcy issues. She is an experienced litigator in the bankruptcy courts in Minnesota and other jurisdictions. Amy also assists lenders in real estate foreclosures, receiverships, pursuing loan collateral, negotiating workouts, and drafting commercial loan documentation. Amy's experience includes the representation of creditors in major chapter 11 bankruptcies including Delta Air Lines, Petters Company, New World Pasta, Polaroid, Renew Energy, Kaiser Aluminum, Advantage Rent-A-Car, Interstate Bakeries, Premier Entertainment, and United Homes.

On day one, Amy will moderate and Clark will participate in a panel discussion titled "Hot Topics in Business Bankruptcy Roundtable," which will discuss the work of the venue reform committee, PROMESA—Puerto Rico's Oversight, Management and Economic Stability Act, the story of Target's bankruptcy in Canada under the Companies' Creditors Arrangements Act, and other topics.

Clark, chair of Maslon's Financial Services Group, focuses his practice on the representation of corporate trustees in a wide variety of capacities related to TIA-qualified senior and subordinated corporate debt issuances, collateralized debt obligations, revenue bonds and certificates of participation on tax exempt public finance projects, and various asset-backed structured financings. His practice includes counseling corporate trustees with respect to the administration of their duties at every stage, including post-Event of Default "prudent person" duties in Chapter 11 and Chapter 9 insolvency proceedings. Together with Maslon's litigation team, he counsels corporate trustees regarding claims and litigation brought by or against them in their trustee capacities.

]]>Thu, 13 Oct 2016 00:00:00 Zhttps://www.maslon.com/deeds-in-lieu-of-foreclosure-boot-camp-foreclosure-and-loan-workout-procedures-national-business-institute-2016
Tue, 14 Jun 2016 00:00:00 Zhttps://www.maslon.com/strategic-bankruptcy-in-foreclosure-boot-camp-foreclosure-and-loan-workout-procedures-national-business-institute-2016
Tue, 14 Jun 2016 00:00:00 Zhttps://www.maslon.com/amy-swedberg-elected-to-the-board-of-directors-of-depart-smart
Maslon is pleased to announce that Amy Swedberg, partner in Maslon's Financial Services Group, has been elected to the Board of Directors of Depart Smart, formerly known as ClearCause Foundation. Depart Smart's vision is for every youth and student going abroad to have safe, rewarding experiences in an industry held to the highest standards with zero preventable deaths and injuries. Depart Smart has developed online education to help students identify and mitigate risks so they return with safe journeys.

"I am excited to join in the Depart Smart mission of promoting safe travel abroad for all students. After reading director Sheryl Hill's book, Walking on Sunshine, and having traveled abroad myself as a student, I know that Depart Smart serves a critical and important need in protecting student safety that was not previously being addressed," Amy shared.

]]>Fri, 15 Apr 2016 00:00:00 Zhttps://www.maslon.com/amy-swedberg-to-moderate-panel-discussion-at-minnesota-cles-2015-bankruptcy-institute
Amy Swedberg, partner in Maslon's Financial Services Group, will present at Minnesota CLE's two-day 2015 Bankruptcy Institute on October 8-9, 2015, where she serves as the Institute's Chairperson. On day two, Amy will moderate a panel discussion titled "Avoidance Actions 101: Common Chapter 5 Claims and the Uniform Voidable Transactions Act," in which panelists will discuss key elements and defenses of avoidance actions in bankruptcy, including preference actions and fraudulent transfer claims as well as features of the new Minnesota Voidable Transactions Act (UTVA) and proposed changes to Chapter 5 of the Bankruptcy Code.

]]>Fri, 09 Oct 2015 00:00:00 Zhttps://www.maslon.com/amy-swedberg-to-present-at-minnesota-cles-effective-civil-litigator-seminar
Amy Swedberg, partner in Maslon's Financial Services Group, will present at a Minnesota CLE seminar titled The Effective Civil Litigator on September 30, 2015. Amy will present a morning session titled "New Uniform Voidable Transactions Act (UVTA)," which will discuss the rationale and status of the new Minnesota Voidable Transfers Act effective August 1, 2015, as well as key features of interest to creditors, debtors, and their respective counsel.

Amy's practice focuses primarily on assisting lenders and other commercial creditors, asset purchasers, adversary proceeding defendants, and indenture trustees with creditor rights and bankruptcy issues. Amy is an experienced litigator in the bankruptcy courts in Minnesota and other jurisdictions.

Cyri focuses her practice on commercial real estate transactions, including real estate acquisition, leasing, development, environmental issues, and financing matters. She also represents financial institutions in connection with commercial lending transactions. Cyri is a 2012 magna cum laude graduate of Hamline University School of Law.

]]>Fri, 07 Aug 2015 00:00:00 Zhttps://www.maslon.com/maslon-welcomes-attorneys-allison-duerr-erica-holzer-and-kristian-weir-to-the-firm
Maslon is pleased to announce the additions of attorneys Allison Duerr, Erica Holzer, Jason Reed, and Kristian Weir to the firm. Each further strengthens Maslon's capabilities in key areas of practice for our clients.

Ali Duerr joins Maslon's Business & Securities Group and focuses her practice in the areas of public company securities law disclosure and compliance, private placements of equity securities, mergers and acquisitions, and corporate governance. She has experience preparing a broad assortment of corporate and transactional documents, including key U.S. Securities and Exchange Commission reports, private placement memoranda and related offering documents, purchase and sale agreements, and formation and governing documents. Ali is a graduate of the University of Denver Sturm College of Law, where she served as executive editor of the Transportation Law Journal. Before joining Maslon, Ali practiced at a large private law firm in Denver.

Erica Holzer joins Maslon's Litigation Group and focuses her practice in the areas of complex commercial disputes, product liability litigation, and appeals. Erica earned her law degree, summa cum laude, from William Mitchell College of Law, where she served as the editor-in-chief of the William Mitchell Law Review. During law school, she was the recipient of the Minnesota Lavender Bar Association's Student Leadership Award and the William Mitchell "Student Award of Merit" at commencement. Before joining Maslon, Erica served as a law clerk to the Honorable Matthew E. Johnson of the Minnesota Court of Appeals.

Jason Reed joins Maslon's Financial Services Group and focuses his practice on corporate trustee representation, issues relating to corporate trust litigation, and bankruptcy concerns. Prior to joining Maslon, he clerked for the Honorable Robert Littlefield, Jr. at the United States Bankruptcy Court for the Northern District of New York. Jason is a 2013 magna cum laude, Order of the Coif graduate of the University of Minnesota Law School. During law school, he served as lead managing editor of the Journal of Law and Inequality and was the recipient of the Kent Wennerstrom Award – Outstanding Student Director 2012-2013.

Kristian Weir joins Maslon's Litigation Group and practices in the area of general commercial litigation. He received his undergraduate degree in history from Boston College and earned his law degree, cum laude, from the University of Notre Dame Law School. Kristian was a member of the Notre Dame Law School Moot Court Team that won the 2013 National AAJ STAC Trial Competition, and was the winner of the 1L Moot Court Competition during his first year of law school. He also had the unique opportunity of serving as a clerk in the Bath Magistrates' Court in Britain, an experience which he incorporated into a dissertation comparing British and American tort systems, written while studying abroad in Bath and at University College, Oxford.

]]>Wed, 19 Nov 2014 00:00:00 Zhttps://www.maslon.com/clark-whitmore-and-amy-swedberg-to-present-at-minnesota-cles-2014-bankruptcy-institute
Maslon attorneys Clark Whitmore and Amy Swedberg will present at Minnesota CLE's two-day 2014 Bankruptcy Institute on October 23-24, 2014. The institute brings together national authorities and Minnesota experts to share their insights into the latest developments and hot topics in bankruptcy law.

On day one, Amy will moderate a panel discussion titled "Current Issues in Fraudulent Transfer Law," in which panelists will discuss recent developments in fraudulent transfer law, including issues in proving and defending claims for actual and constructive fraud, statute of limitations issues for claims arising under the Minnesota Uniform Fraudulent Transfer Act, and attempts to limit statutory exceptions to a trustee’s ability to avoid fraudulent transfers. Later in the day, Amy will participate as a panel member in a session titled "Mock Hearings – Examples of What to Do and Not to Do in Trial," featuring a series of vignettes of various witness and evidentiary issues in bankruptcy cases.

Additionally, Clark will participate as a panel member in a breakout session titled, "Current Issues in Chapter 11 Cases: Classification, Credit Bidding, Confirmation and Cramdown." During the session, the panel will discuss recent caselaw developments by bankruptcy and other courts in the Eighth Circuit and other jurisdictions on classification of claims, the section 1111(b) election, credit bidding and limitations on credit bidding, valuation of secured claims under section 506, and cramdown of plans on secured creditors.

Clark Whitmore, chair of Mason's Financial Services Group, focuses his practice on the representation of corporate trustees in a wide variety of capacities related to TIA-qualified senior and subordinated corporate debt issuances, collateralized debt obligations, revenue bonds and certificates of participation on tax exempt public finance projects, and various asset-backed structured financings. His practice includes counseling corporate trustees with respect to the administration of their duties at every stage, including post-Event of Default "prudent person" duties in Chapter 11 and Chapter 9 insolvency proceedings. Together with Maslon's litigation team, he counsels corporate trustees regarding claims and litigation brought by or against them in their trustee capacities.

]]>Fri, 24 Oct 2014 00:00:00 Zhttps://www.maslon.com/current-issues-in-chapter-11-cases-classification-credit-bidding-confirmation-and-cramdown-2014-bankruptcy-institute-minnesota-cle-2014
Thu, 23 Oct 2014 00:00:00 Zhttps://www.maslon.com/current-issues-in-fraudulent-transfer-law-moderator-2014-bankruptcy-institute-minnesota-cle-2014
Thu, 23 Oct 2014 00:00:00 Zhttps://www.maslon.com/mock-hearings-examples-of-what-to-do-and-not-to-do-in-trial-panel-member-2014-bankruptcy-institute-minnesota-cle-2014
Thu, 23 Oct 2014 00:00:00 Zhttps://www.maslon.com/brian-klein-appointed-2014-president-of-minnesota-chapter-of-acg
Brian Klein, partner in Maslon's Financial Services Group, was appointed 2014 President of the Minnesota Chapter of the Association for Corporate Growth (ACG). ACG is the premier global association for business executives and professionals involved in corporate growth, corporate development, and mergers and acquisitions. Brian has been a board member of ACG Minnesota since 2010, served as Vice President of Programming 2010 - 2012, and then as President-Elect in 2013.

As President, Brian will guide ACG Minnesota Chapter in all leadership activities and special projects. "I am proud to be leading ACG Minnesota in 2014 and am supported by a passionate and diverse group of Board members from the business community," he notes. "We look forward to improving and expanding the many great corporate growth programs, including the Second Annual Bold Awards, our Capital Connection event, quarterly Corporate Speaker Series and of course our monthly luncheons." Brian offers, "For anyone who is not a member, please consider attending one of our upcoming events."

Brian Klein has extensive experience representing banks, insurance companies and other capital providers in all forms of commercial financing transactions, including large loan syndications. Such experience further includes representation of lenders in loan workouts and foreclosures, as well as secured creditor representation in bankruptcy. Among other things, Brian also represents owners in all aspects of commercial real estate, including acquisition, leasing and financing matters.

For more information about the Association for Corporate Growth, go to www.acg.org/minnesota. ]]>Wed, 22 Jan 2014 00:00:00 Zhttps://www.maslon.com/amy-swedberg-to-moderate-panel-discussion-at-minnesota-cle-2013-bankruptcy-institute
Amy Swedberg, partner in Maslon’s Financial Services Group, will moderate a panel discussion at Minnesota CLE's 2013 Bankruptcy Institute on October 8-9, 2013. The discussion, part of an afternoon breakout session titled “Litigation Skills and Techniques for Bankruptcy Lawyers,” will focus on the effective use of pre-trial stipulations, examinations and cross-examination of witnesses, exhibits and courtroom etiquette.

Amy Swedberg focuses primarily on creditors' rights and bankruptcy in the representation of financial institutions, indenture trustees and other commercial creditors in default situations. Amy also assists lenders in real estate.

For more information, go to Minnesota CLE.]]>Wed, 09 Oct 2013 00:00:00 Zhttps://www.maslon.com/advanced-preference-defenses-leveraging-new-value-ordinary-course-contemporaneous-exchange-and-other-key-defenses-webinar-strafford-publications-2012
Mon, 01 Apr 2013 00:00:00 Zhttps://www.maslon.com/tousa-radlax-and-more-the-impact-of-recent-case-law-on-restructuring-professionals-moderator-turnaround-management-association-mid-america-regional-conference-2012
Fri, 01 Mar 2013 00:00:00 Zhttps://www.maslon.com/everything-you-wanted-to-know-about-claims-but-were-afraid-to-ask-minnesota-cle-bankruptcydebtor-creditor-webcast-series-2013
Tue, 01 Jan 2013 00:00:00 Zhttps://www.maslon.com/ponzi-schemes-strategies-for-defending-clawback-litigation-webcast-co-presenter-minnesota-cle-2012
Wed, 01 Feb 2012 00:00:00 Zhttps://www.maslon.com/introduction-what-is-a-claim-types-of-claims-filing-a-proof-of-claim-allowance-of-claims-and-objections-to-claims-post-petition-claims-subordination-of-claims-chapter-author-bankruptcy-practice-i
Bankruptcy Practice in Minnesota Deskbook, Minnesota CLE, 2012]]>Sun, 01 Jan 2012 00:00:00 Zhttps://www.maslon.com/advanced-preference-defenses-panel-member-minnesota-cle-bankruptcydebtor-creditor-webcast-series-2012
Sun, 01 Jan 2012 00:00:00 Zhttps://www.maslon.com/advanced-real-estate-and-foreclosure-law-national-business-institute-2012
Sun, 01 Jan 2012 00:00:00 Zhttps://www.maslon.com/top-ten-common-bankruptcy-issues-facing-corporate-counsel-meritas-2011
Association of Corporate Counsel, 2011]]>1. Can I Still Do Business With the Debtor and What Are My Risks?
In chapter 11 bankruptcy, the debtor remains in possession and control of its assets and can continue to operate its business and conduct transactions in the ordinary course of its business. Transactions outside the ordinary course of its business, including those a debtor only occasionally engages in such as selling off a part of its business or entering into a credit facility, require advance bankruptcy court approval. There may be less risk extending credit to a chapter 11 debtor because all "post-petition" debts constitute priority "administrative claims" that are paid in full prior to any distribution to unsecured creditors, but some estates can become administratively insolvent if secured creditors are owed more than the value of their collateral.

In chapter 7 bankruptcy, the debtor ceases operating its business and ownership and control of its assets are transferred to a chapter 7 trustee for liquidation. The only exception is for individual debtors who can claim some property is "exempt" or not subject to creditor claims under applicable law. The name and contact information for the chapter 7 trustee is provided on the notice sent to creditors, and the trustee can be contacted with questions regarding the case.

Upon any bankruptcy filing, the "automatic stay" under 11 U.S.C. § 362 immediately goes into effect and prohibits action against the debtor or its property, including sending a simple demand letter to the debtor. The debtor or a trustee can sue anyone who violates the automatic stay.

2. If I Have an Ongoing Contract With the Debtor, Do I Have to Perform?
Yes. A non-debtor party to a contract is not excused from performance merely because the other party filed for bankruptcy. A contract that has ongoing obligations on both sides (called an "executory contract") can be "assumed" or "rejected" by the debtor during its case. Until then, the non-debtor party must continue to perform or risk becoming liable for breach. Performance is excused when the contract is rejected, and the non-debtor party can file a motion to compel the debtor to reject the contract if the debtor is not meeting its obligations, such as making lease payments for use of property. In a chapter 7 case, all executory contracts not assumed by the chapter 7 trustee are deemed rejected 60 days after the "petition" or bankruptcy filing date.

If a debtor seeks to "assume" an unexpired lease or other executory contract, it must cure all defaults and accept the contract as is without modification. The cure amount can be negotiated but the non-debtor party is not required to accept anything less. If the proposed cure amount in a notice sent to you is stated as $0 or less than what is actually owed, you must file a formal objection within the time stated in the notice or risk losing your right to insist on a full cure.

3. I Recently Sent Goods to the Debtor, Do I Have Priority or Reclamation Rights?
Yes. Bankruptcy law expands a creditor’s right to reclaim goods from within 10 days of delivery under Uniform Commercial Code § 2-702 to within 45 days of delivery under 11 U.S.C. § 546. The demand for reclamation must be asserted in writing within 20 days after the petition date and can usually be asserted in a letter with a description of the goods that is mailed to the debtor and its attorney. Reclamation rights are subject to the existing claims of secured creditors and goods not in existence or identifiable at the time a demand is made cannot be reclaimed.

Another valuable right afforded creditors under the Bankruptcy Code is a creditor’s right to receive priority payment for goods delivered within 20 days of the petition date. These priority claims are referred to as "20 Day Claims" or "Section 503(b)(9) Claims" based on the relevant Code section. These claims must be asserted in a motion filed with the bankruptcy court. In some large chapter 11 cases, the debtor will seek approval of a specific claim form to be used by creditors asserting these claims in lieu of filing a motion.

4. How Do I Find Out What is Happening in the Bankruptcy Case?
All bankruptcy case dockets are accessible and most pleadings can be downloaded from the internet with a PACER (Public Access to Court Electronic Records) account. Register for a PACER account here. Under current law, a debtor can file for bankruptcy in the jurisdiction in which it was organized or incorporated, or in the jurisdiction in which it primarily operates its business.

All bankruptcy court web sites use a 2 letter state code, followed by the district code if applicable (such as "s" for southern or "c" for central), and end with the letter "b" for bankruptcy. Thus, for example, the bankruptcy court web site for the Southern District of New York is www.nysb.uscourts.gov and for Delaware it is www.deb.uscourts.gov.

If you are an unsecured creditor, you can also contact counsel for the creditor’s committee for current information regarding the case. In most chapter 11 cases, the U.S. Trustee’s office will appoint an "Unsecured Creditor Committee" that can hire attorneys or financial advisors at the debtor’s expense. Contact information for committee counsel is listed at the top of the docket.

5. The Debtor Owes My Company Money for Goods or Services.
If the debtor owes your company for goods or services provided prior to the petition date, you can file a Proof of Claim ("POC") and attach supporting documentation. A POC form is mailed to creditors with the initial case filing notice or can be downloaded from the bankruptcy court’s website. POCs can be filed electronically or mailed to the court. If mailed, include a copy of the POC cover page with a self-addressed, stamped envelope for obtaining verification your claim was received. Most chapter 7 cases are filed as "no asset" cases and the initial case filing notice will state "Please Do Not File a Proof of Claim Unless Instructed To Do So." The chapter 7 trustee will send out notice to creditors and a POC form if assets become available.

The deadline for filing a POC varies by jurisdiction but is usually 90 days after the date scheduled for the "Meeting of Creditors." In some jurisdictions, the claim deadline for a chapter 11 case is set by order of the court. The POC form includes instructions for filling it out and allows you to assert whether your claim is secured by collateral or entitled to priority status. You should consult bankruptcy counsel if you believe you have a secured or priority claim to ensure that your rights are properly protected and preserved.

6. Can I Repossess Collateral that Secures My Claim?
As noted earlier, the automatic stay under 11 U.S.C. § 362 goes into effect immediately upon a debtor’s bankruptcy filing and prohibits a creditor from taking any action to recover collateral. If you hold a lien in the debtor’s property, you need to file a motion seeking relief from the automatic stay before you can enforce rights against the collateral. To the extent your lien was not properly perfected under applicable state law (usually Art. 9 of the UCC), the debtor or a trustee in bankruptcy can seek to avoid your lien leaving the claim unsecured.

You may be entitled to request relief from the automatic stay to recover your collateral (i) if the debtor has no equity in the collateral and it is not necessary for reorganization, or (ii) for "cause" if the debtor has failed to provide you with "adequate protection" to protect the value of your collateral during the debtor’s use in bankruptcy such as by making lease payments.

7. The Debtor Paid My Company for Goods or Services in the Last 90 Days.
If you were paid by the debtor in the 90 days prior to its bankruptcy filing (the "preference period"), you are at risk of being sued for the recovery of a preference. 11 U.S.C. § 547(b) defines a preference as: (i) a transfer of the debtor’s interest in its property, (ii) to or for the benefit of a creditor, (iii) on account of an "antecedent" or pre-existing debt, (iv) made while the debtor was insolvent (there is a presumption of insolvency for the 90-day preference period), and (v) on or within 90 days (or within 1 year for "insiders") prior to the petition date that enables the creditor to receive more than it would in a chapter 7 liquidation.

8. I Have Been Sued for a Preference, What are My Defenses?
The most common defense to a preference claim is that the payment was made and received in the ordinary course of business ("OCB"). The OCB defense can be proven either subjectively (based on prior transactions between the debtor and that creditor) or objectively (using an industry standard often established through expert testimony). Factors which may take a transaction outside the OCB include payments received from collection efforts, payments made either too quickly or too slow as compared to past payments, or payments by uncommon means, such as a cashier’s check or wire transfer. The subsequent "new value" defense is established by demonstrating that the debtor received something of value from the creditor in an otherwise unavoidable transfer after the payment was made (e.g. subsequent shipment of goods). Most jurisdictions recognize this defense even if the creditor was later paid for the new value provided. Other defenses include "contemporaneous exchange of value" for C.O.D. transactions or payments made within a few days of delivery if intended to be substantially contemporaneous, and there is a small preference safe harbor for transfers less than $5,850 (adjusted every 3 years).

Preference lawsuits can be initiated by mailing a summons and adversary complaint to a defendant by regular U.S. mail; personal service is not required. The deadline for responding is 30 days from the date of the summons, provided the complaint was mailed within 10 days of issuance. Most preference lawsuits are settled through the informal exchange of information supporting alleged defenses, such as a spreadsheet for the OCB defense showing a history of invoice, payment and number of days to pay for the time period just prior to the preference period and the preference period, or by sending copies of invoices for goods or services constituting "subsequent new value" given to the debtor after the receipt of any alleged preferential transfer.

9. What Does it Mean When a Company Exits Bankruptcy?
A company "exits" bankruptcy when it has confirmed a chapter 11 plan of reorganization. The bankruptcy case will likely stay open for several months or years after a plan is confirmed while post-confirmation matters are handled, such as suing out preferences and reviewing and objecting to claims and making distributions on claims.

10. When Can I Expect to Receive a Distribution on My Proof of Claim?
Distributions on claims is the last thing to occur before a bankruptcy case is closed and may not occur until several months or years after a chapter 11 debtor has confirmed its plan or sold its assets in bankruptcy. The debtor or trustee must first pursue all claims held by the bankruptcy estate, such as preference or fraudulent transfer claims under federal bankruptcy law or other state or common law claims held by the debtor on the petition date. All proofs of claim are also reviewed for potential objection, including as to claim amount or alleged priority.

The general priority scheme for making distributions on claims under bankruptcy law is as follows: (1) secured claims up to the extent of the value of the collateral, (2) chapter 7 post-conversion priority administrative claims if applicable, (3) chapter 11 priority administrative claims within the order of their priority under 11 U.S.C. § 503, (4) general, unsecured claims, and (5) equity interests in the debtor.

Conclusion
The Bankruptcy Code and bankruptcy proceedings can be complex and intimidating for non-bankruptcy lawyers. However, the above tips should help you to navigate some of the most common issues facing companies who have done business with a person or entity who later files for bankruptcy.